Recovery of certain dues as arrears of land revenue

(1) Where any person either as principal or as surety or as guarantor is a party-

1. (a) (i) to any agreement or bond, relating to a loan, advance grant, subsidy, financial assistance, stipend or scholarship given under that agreement or relating to credit in respect of, or relating to hire purchase of goods sold by the State Government, Government Company, Banking Company, or Corporation by way of financial assistance; or
   • (ii) to any agreement relating to loan, advance, grant or subsidy given under that agreement or relating to credit in respect of, or relating to hire purchase of, goods sold by the State Government, a Banking Company, a Corporation or a Government Company as the case may be, under a sponsored scheme; or
2. (b) to any agreement relating to a guarantee given by the State Government, Government Company, Banking Company or a corporation in respect of a loan raised by an industrial undertaking; or
3. (c) to any agreement providing that any money payable thereunder to the State Government shall be recoverable as arrears of land revenue; or
4. (d) to any agreement to sell or distribute goods or any other article supplied by/or through the State Government and such person-
   • (i) makes any default in the repayment of the loan, advance, stipend or scholarship or any instalment or interest thereof; or
   • (ii) having become liable under the conditions of the grant to refund the grant or any portion thereof, makes any default in repayment of such grant or portion or instalment thereof; or
   • (iii) having become liable to pay the price of the goods or any other article or interest thereof, fails to pay the same or part thereof; or
   • (iv) otherwise fails to comply with the terms of the agreement; then, in case of the State Government, such officers as may be authorised in this behalf by the State Government, by notification in the Official Gazette, and in the case of Banking Company, Corporation or the Government Company, the Managing Director or any other officer not below the rank of Divisional Manager specifically authorised in this behalf, thereof, by whatever name called, may without prejudice to any other mode of recovery under any other law for the time being in force, send a certificate to the Collector, mentioning the sum due from such person and requesting that such sum together with the costs of the proceedings or any other sum be recovered as if it were an arrear of land revenue.

1. (2) A certificate sent under sub-section(1) shall be conclusive proof of the matter stated therein and the Collector on receiving such certificate shall proceed to recover the amount stated therein as an arrear of land revenue.
2. (3) Nothing in sub-section (1) shall affect any interest of the State Government, a Banking Company, a Corporation or a Government Company, in any property created by mortgage, charge, pledge or any other encumbrance.
3. (4) Where the property of any person referred to in sub-section(1) is subject to any mortgage, charge, pledge or other encumbrance in favour of the State Government, a Banking Company, a Corporation or a Government Company, as the case may be, then-
   • (a) in every case of a pledge of goods, proceedings shall first be taken for the sale of goods so pledged and if the proceeds of such sale are less than the sum due, then proceedings shall be taken for recovery of the balance against the other property of such person: Provided that where the State Government is of the opinion that it is necessary so to do for safeguarding the recovery of the sum due to it or to a Banking company, a Corporation or a Government Company, as the case may be, it may, for reasons to be recorded in writing, direct proceedings to be taken against the other property then the goods pledged before or at the same time as the proceedings are taken for the sale of goods pledged.
   • (b) in every case of a mortgage, charge or other encumbrance on immovable property, such property or, as the case may be, the interest therein of the person referred to in sub-section (1) shall first be sold in proceedings for recovery of the sum due from that person and any other proceedings may be taken only if the Collector certifies that there is no prospect of realisation of the sum due through the first mentioned process within a reasonable time.
4. (5) Where Government dues are recoverable from the person mentioned in section 3 in addition to dues of Government Company, Banking Company or Corporation, priority will be given to Government dues in recovery as arrears of land revenue.